I haven't used D2D, so I have no explanation for the issue you're experiencing. If you can tell me what to download and how to test (and/or send sample files), I would be most grateful and will then happily look into things over the weekend. My Rapidus spends most of its time in the spares box and is brought out for the explicit purpose of developing these drivers and tools, so everyday usage feedback is most welcome (I'm happy enough to do everything at 1.79MHz, as it turns out).
To answer the second question: SIDE.SYS essentially works just like the RAMDISK.SYS driver. It adds an entry to the SDX LSIO table (which SDX calls instead of the OS SIO vector). allowing low-level block IO transfers to be redirected to the HDD. Conversely, the 'internal' SIDE driver (i.e. the U1MB PBI BIOS) actually intercepts the OS ROM SIO vector at the OS level, allowing the HDD to work with software which calls SIOV directly and thus with any DOS you like.